Too Many Companies Struggle with Making Process Changes

Issue #11235 - February 2019
| Page #18

By Todd Drummond

A statement far too managers make is that they are not able to get their employees to embrace change. If your company struggles with making changes in any given area, just keep in mind that real change always comes from the top down. If your company is struggling with change and you are the top dog, the solution starts with you. Every company should have as a goal that improvement is not an option but rather a must-change-to-stay-competitive-or-we-will-fail mentality. The Japanese word for this idea of “good change” is kaizen. Most companies who embrace lean manufacturing practices simply refer to this as being continuous improvement.

Failure examples: Sometimes people within a company want to improve their given area of responsibility, but they have no real power to do so. In other words, they do not have management’s authority to implement the needed change. Improvement often requires responsibility shifts to implement a change of current practices. Thus, all too often a game of “protection of perceived power” within each group will happen instead, stifling change. Another issue is that change requires effort even though everyone is already tasked with a very busy workload. Few want to give up their current practices, believing only the other departments need to make any type of change. Newbies to the continuous improvement process often resort to doing their best to show how much the overall organization will benefit from the changes, but without true buy-in from everyone, along with the backing of better management practices, it is a total waste of time. These companies are typically rife with executive top-down micro-management, and over the many years of that type of management practices, the employees have been conditioned never to take ownership or to offer suggestions for improvement. More often than not, these types of companies view a major equipment purchase as the one thing that will make all the difference. Typically, an equipment purchase is biased toward the recommendation of a company’s current vendor, without the company knowing the true pros and cons of the solution. Too often, once the new equipment is purchased and installed, all of the other practices that need to be refined for its proper use are not properly thought through, and therefore, the new investment is only marginally helpful for the company’s situation. I cannot tell you how many times I have witnessed expensive equipment being severely underutilized. Without a doubt, these types of organizations are the most difficult and disheartening to witness. They typically have high employee turnover with positions constantly vacant, so their overall output suffers. Their cost of manufacturing is marginal at best. Also, they are always the ones with net profits typically in the single digits and occasionally low teens. These are companies that will have trouble remaining in business during tough times.

Successful examples: Real positive change comes from the top down of the organization. Upper management creates a “we” instead of an “I” environment for team empowerment, deep involvement, and a can-do attitude. Micro-management is thoroughly discouraged and is the polar opposite of the company’s culture. For continuous improvement to be a part of the company culture, it starts with the chief executive officer (CEO). The CEO must resist the temptation to override people’s ideas and suggestions. To facilitate better practices, the CEO must give them tools, such as lean manufacturing training, with real-world examples of how these tools work within the company. Employees cannot implement anything new if they are not taught and exposed to other ways of doing business. Once employees understand that their ideas have true value within the company and are exposed to better practices, you will see real gains. The best companies I have witnessed implementing better practices do so by teaching new ideas about lean manufacturing principles, listening instead of always demanding, and empowering and encouraging their employees by promoting the ownership of new ideas and a constant teamwork attitude. Many ask me, “What is the single most important thing that will make a real positive difference in our organization?” I tell them that they must first embrace the idea of a culture of continuous improvement, and everything else comes second. Yes, refining labor standards, improving pricing methods, and maybe purchasing new equipment will make a big difference, but all the other things need to be done, too. It is never just one thing but rather many things that add up to making a real positive change. A sustained effort is needed to constantly review and methodically implement all the desired changes you are going to implement. Every company I have seen implement this type of cultural environment has three common results:

1st. Lowest employee turnover, both in the shop and in the office;

2nd. Lowest cost of manufacturing, lowest errors, and best quality; and finally,

3rd. Best net profits that start in the mid-teens and are often in the mid-20s during peak times.

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